THE NEED FOR COMPREHENSIVENESS AND INCREASED
ENFORCEABILITY IN THE STANDARDIZATION OF INTERNATIONAL
PHARMACEUTICAL REGULATIONS

Ellen A. Hochberg

Table of Contents

THE NEED FOR COMPREHENSIVENESS AND INCREASED
ENFORCEABILITY IN THE STANDARDIZATION[1] OF INTERNATIONAL PHARMACEUTICAL REGULATIONS

I. INTRODUCTION

Sovereign nations have the responsibility to
protect the health and well-being of their constituents. This
responsibility manifests itself in an often staunch defense of
national pharmaceutical regulations, developed to protect citizens
from unsafe products. However, differences in regulatory systems
across countries create barriers to trade in pharmaceuticals. As
the world becomes increasingly interconnected, barriers to trade
seem increasingly anachronistic. The economic and social benefits
from reducing impediments to inter-nation trade are indisputable.
This principle holds true for the pharmaceutical industry, in which
liberalization would produce enormous benefits for industry and
consumer alike. In recognition of the benefits of
internationalization, many nations are moving towards eliminating
non-tariff barriers to trade through standardization of their
pharmaceutical regulatory systems.

This article will discuss the main mechanisms by
which the United States and other countries are attempting to
standardize their pharmaceutical regulations. I first explore the
need for standardization and the potential benefits that
standardization offers. Then I sketch the early efforts of nations
to move toward standardization. I present and critique the
mechanisms by which standardization is currently proceeding and the
progress that has been made to date. I also detail the Food and
Drug Administration’s (FDA) participation in international
standardization.

I argue that reform of the standardization process
is necessary to reap the full benefits of standardization.
Specifically, the various tools of standardization, the ICH, MRAs,
and MOUs need to be integrated so as not to work at cross-purposes.
The standardization process must be expanded to account for the
views of consumers and non-member nations. Most importantly, in the
absence of a way to bind nations to commitments to standardize
pharmaceutical regulations, standardization mechanism are in danger
of becoming another layer of regulatory delay; to avoid this
pitfall, standardization agreements must be made enforceable.

II. BACKGROUND

A. The Need for Standardization

Standardization of pharmaceutical regulations will
benefit consumers and producers alike, by bringing effective
treatments to market faster and reducing the costs of drug
development. Developing a drug for marketing is an extraordinarily
costly process, both in money and time. One estimate places the
average costs to develop a prescription drug at an average of $802
million.[2] Bringing a drug to market takes between ten and
fifteen years in the United States.[3] The rising costs of drug development have been
attributed to spiraling clinical trial costs.[4]

Historically, each country has had its own
standards for regulating pharmaceuticals marketed in that country.
The FDA for example, requires several phases of testing, as laid
out in the Federal Food, Drug, and Cosmetic Act (FDCA), before
allowing a drug to be sold to the public.[5] Individual countries often require that domestic
legal and regulatory standards be met even if a drug is already
widely marketed in another or several other countries.[6] Thus, for the FDA to approve a drug for use in the
United States, a domestic investigator must sometimes replicate the
results of experiments already conducted in the drug’s
country of origin.[7] Such requirements necessitate that a drug undergo
expensive and time-consuming clinical trials to satisfy each agency
from which approval is sought.[8]

Regulatory delays have detrimental effects on
potential consumers. Economists and doctors worry that patients
will not be able to gain access to life-enhancing and possibly
life-saving treatments as cheaply or quickly.[9] Patients who would be willing to take the risks and
use new drugs before they are approved by the FDA lose the
potential therapeutic benefits they might have received.[10] Supporters of standardization see the FDA drug
regulatory process as inordinately cautious and decry FDA
resistance to reducing the stringency of the requirements for drug
approval. After Thalimide and other disasters, the FDA developed
drug regulations in deference to the public’s refusal to
sacrifice safety for cost effectiveness.[11] Critics of the FDA assert that such caution is
causing more deaths than it prevents, by delaying access of
Americans to life-saving drugs.[12]

However, these effects are difficult to quantify,
and as such fail to spur action to the same extent as do reports of
adverse effects of drugs.[13] A study of therapeutic loss conducted over twenty
years ago, concluded that the increased stringency in drug approval
by the FDA after 1962 caused a decrease in drug innovation in the
United States. The therapeutic loss resulting from FDA regulation
was estimated at over $450 million per year.[14] More recent studies posit that regulatory delays
negatively impact patient life expectancy and quality of
life.[15] While a drug that produced fatalities of this
magnitude would be seen as catastrophic, this therapeutic loss has
been largely ignored.

The necessity to comply with the incompatible
regulations of various agencies has negative implications for
industry, as well as consumers. Faced with the costs of duplicative
research trials, pharmaceutical companies raise their prices, take
longer to introduce drugs into the market, or choose not to enter
some markets.[16] Regulatory inconsistencies across countries
prevent pharmaceutical companies from developing globally
acceptable product designs, manufacturing processes, packaging and
labeling.[17] Due to the additional expense to pharmaceutical
companies in complying with multiple regulatory schemes, these
companies are less likely to pursue global markets.[18] Further, the increased lag time between
development and distribution of a product due to standards that
differ across nation increases industry costs through lost sales
revenue, decrease in effective patent life, lost working capital,
and wages of worker hours to process multiple
applications.[19] Decreasing profits from drug sales reduce the
incentive for multinational companies to develop new
pharmaceuticals.

Ability of drugs to enter overseas markets is
hampered by the need for often duplicative studies to meet the
requirements of the domestic agency charged with regulating
pharmaceuticals in each country. The significant up-front costs to
companies of learning the distinct regulations of another market
force small drug companies from developing new drugs.[20] Drug approval time for companies that do seek to
enter foreign markets is lengthened.[21] Furthermore, the pharmaceutical industry argues
that replicating trials already conducted in a foreign country is
too expensive given its doubtful value.[22] Increases in international trade also strain
already overextended regulatory resources.[23]

Reduction or obliteration of the necessity of
complying with different regulatory regimes would benefit both
consumers and producers. For consumers, standardization would
remove the obstacles to patients accessing affordable, effective
curative treatments. Beside lowering health care costs and
providing faster access for the public to new treatments,
international consensus on regulations would enhance international
public health as the best of each country’s health system is
meshed together.[24] Furthermore, a global response is needed since
disease recognizes no national borders.[25] For companies, standardization will bring about
greater revenue from sales of pharmaceuticals as drugs go on the
market much sooner.[26] In the United States, if regulatory approval time
is reduced by one year, drugs can generate profits three to four
years earlier as the costs of maintaining a drug in the absence of
profits would be decreased and profits would accrue sooner. Six
months less of review time could generate savings of millions of
dollars for companies that can be reinvested in research.[27] U.S. companies might choose to locate more
manufacturing and research facilities in the United States in the
absence of the myriad of regulations that have driven them
overseas.[28] Standardization will facilitate simultaneous
introduction of a new drug in various countries as well as
intra-company globalization of procedures across the global
organization, particularly for clinical study protocols and
reports.[29] Regulators would be more efficient given the
benefit of the experiences of their counterparts in other
countries.[30]

Ascertaining the safety of new drugs does not
require that each country maintain a disparate regulatory approval
system. Rather, various mechanisms of harmonization can reduce the
costs, detailed above, of multiple regulatory systems, while still
ensuring consumer safety. In fact, in pressing single-mindedly for
greater regulation of pharmaceuticals, consumer advocates often
labor under the mistaken impression that more strictures
necessarily result in increased safety. However, greater control of
drug production may not improve drug safety.[31] Standardization aims to create safer
pharmaceuticals by distilling the shared wisdom of multiple
regulatory systems into a more effective drug development and
approval process, in which some tests might even be decreased or
eliminated.[32]

B. Early Attempts at Standardization

Regulatory authorities have been under increasing
pressure to standardize the drug approval process. Regulatory
agencies must operate in an increasingly complex economy, one in
which the health industry, and the multinational companies that
dominate it, is a powerful force. Such multinational companies
would prefer to submit one application to one regulatory body for
approval to market a drug. The rapid pace of technological change
challenges regulatory agencies to fit new models of therapeutics
into existing systems. Resource constraints in the face of new
technologies require innovative solutions and collaboration on
behalf of regulators. In a world in which international activities
are increasingly important, collaborative strategies are becoming
ever more necessary for regulators.[33]

The movement towards standardization of
pharmaceutical regulations was presaged by the movement to
standardize food regulations. Specifically, in 1962 the World
Health Organization (WHO) and the United Nations Food and
Agriculture Organization (FAO) jointly established the Codex
Alimentarius Commission (Codex), an international standard-setting
body intended to facilitate international trade of food and to
ensure that the world's food supply is sound, wholesome, and
properly labeled.[34] All members and associate members of the WHO and
FAO can become members in the Codex.[35] Codex sets descriptive standards for foods so
that the 162 member nations all have the same understanding of what
constitutes a given food. [36]

Since its establishment, Codex has promulgated over
250 international food standards. These standards are developed by
Codex’s fourteen subsidiary commodities committees and eight
broader committees that deal with more general subjects, such as
the Codex Committee on Food Additives and Contaminants. After
adoption by Codex, food standards are promoted to member nations
for their acceptance.[37] Member countries and nongovernment organizations
(NGOs) can comment freely on food standards under development in
the Codex committees, allowing the food industry to work with
government officials and within NGOs to forge a unified position.
The structure and operating principles of Codex are reflected in
the ICH.[38]

Codex standards are not binding on member
nations.[39] In recognition of its members’ sovereignty,
countries are allowed to decide what parts of the international
standards, if any, they will adopt, with Codex membership entailing
no obligation to follow any Codex standard or guideline.[40] For example, the FDA does not view the Codex
standards as binding safety standards.[41] Nonetheless, the U.S. Codex, the organization
comprising government officials from the U.S. Department of
Agriculture, the Food and Drug Administration (FDA), and the
Environmental Protection Agency which manages and implements United
States involvement in Codex, aims to strengthen Codex as a means of
fostering adherence to Codex standards to realize the economic
benefits of standardization.[42]

In a recent change in policy, Codex standards have
been given “teeth.” Members of the World Trade
Organization (WTO) are now obligated to incorporate Codex food
standards into their national regulations and such standards are
persuasive authority under the WTO dispute resolution
structure.[43] Member nations are allowed to develop more
stringent requirements than those proposed by Codex, but these
standards may be challenged under the WTO as disguised trade
barriers.[44]

Other than Codex, various multilateral efforts to
regulate the food supply set the precedent for international
cooperation that ultimately spread to the pharmaceutical industry.
For example, in an attempt to address common problems, FDA
officials met semiannually in the 1970s with representatives of the
regulatory bodies of Canada and Britain to discuss problems facing
one country that for which the other countries might be at risk.
These discussions led to some collaborative attempts to deal with
shared threats. One such collaboration was the joint effort to
evaluate a Canadian study on saccharine.[45]

Likewise, the common nature of many issues involved
in drug regulation led to similarities in solutions across
countries even prior to formal standardizations attempts.
Specifically, all countries needed to respond to public pressure
for increased speed in getting effective and safe treatments to
those in need in the face of rising drug development and research
costs.[46] Subject to these conditions, decisions that
regulatory regimes in all countries need to make include: how to
balance increased speed of approval with protecting the public
against potential hazards; whether to focus on safety and
innovation or on proven efficacy; and whether to measure value of a
drug in terms of clinical benefits or a narrower evaluation of
factors such as cost-effectiveness or protection of domestic
producers.[47]

Although not necessarily to the same degree, all
countries have to deal with the abovementioned issues, with the
likelihood that they will gravitate toward some similar solutions.
[48] This remains true even though an issue of
particular prominence in one country may be faced to a lesser
degree by other countries’ regulatory bodies. For example,
Japan focused on fostering innovation and attention to physiologic
distinctiveness; the U.K. has been concerned with regulatory
secrecy and conflicts of interest; the Unites States has had
particular problems with the demands of political constituencies
and balancing rapid approval with societal safety; and France has
had to deal with the treatment of alternative medicines and the
impact of regulations on local industry.[49] An example of the arrival at similar solutions to
a similar problem despite differential emphases includes the
FDA’s fee structure to make drug registration applicants fund
their own registration process.[50] Such a system is similar to the United Kingdom
institution of self-financing regulatory agencies (sefras),
agencies licensed by government that make regulation a business by
charging those regulated for their regulation services.[51]

The process of similar solutions developing in
response to similar problems is self-reinforcing.[52] Once similar solutions are chosen, the divergence
between the regulatory regimes in different countries is reduced.
Countries with more convergent background regimes as the context
for regulatory decision-making are even more likely to make similar
choices.

Early attempts at more formal standardization were
propagated by regional alliances. The Council of Europe and the
Organization for Economic Cooperation and Development (OECD) have
supported pharmaceutical standardization.[53] The Council for Mutual Economic Assistance, the
European Free Trade Area, and the Nordic Council of Medicines each
created shared testing and evaluation guidelines.[54] From 1973 to 1978 Belgium, Luxembourg, and the
Netherlands instituted a common system of drug registration, an
experiment that encouraged pharmaceutical companies to advocate
increasingly for standardization of regulatory regimes.[55]

More than any other step toward standardization, EC
legislation on pharmaceuticals represented multi-country regulatory
consensus and demonstrated that such consensus was
possible.[56] The EU had been working toward a common regulatory
process for drugs as early as 1965.[57] In 1965, directive 65/65 set the stage for
automatic mutual recognition of national drug marketing
authorizations among member European states. Action on the
directive occurred in 1975, with the establishment of the Committee
for Proprietary Medicinal Products (CPMP). The CPMP created a
multi-state procedure for drug approval, in which the CPMP served
as a central clearinghouse for drug approvals submitted by any of
the twelve member states of the European Economic Union to any
single European State. After approval was sought in any single
state, application could be made to as many as five states within
the Union, and those States were required to consider the approval
in the initial state in conducting their own reviews.

However, because each state could reject a drug
despite approval by the initial state of submission and almost all
submissions were denied general approval due to objections from
member states, the CPMP system effectively added another layer of
approval without any apparent benefit in expediting market
access.[58] Changes to the CPMP system, allowing drug
companies to apply for approval in a single and the CPMP
simultaneously, with applications to additional states granted
unless the other states responded negatively within ninety days,
failed to remedy the situation of mutual distrust and
stalemate.[59]

Real progress toward European mutual recognition
only came with the 1987 centralized procedure for the approval of
biotech products, followed by the 1993 provisions of the European
Commission authorizing the creation of a European Agency for the
Evaluation of Medicinal Products (EMEA). The EMEA was endowed with
the power to grant marketing authorizations valid throughout the
EU.[60] The EMEA coordinates the approval, manufacturing
and inspection of medicines between the CPMP and regulatory bodies
of member states. Requests to the EMEA are forwarded to the CPMP,
which issues an opinion within 210 days, subject to the affirmation
of the European Commission’s Standing Committee on Medicinal
Products for Human Use. By allowing the acceptance of the CPMP to
become final unless the European Council acts within ninety days of
a rejection by the Standing Committee, the system facilitates
approval and rejection by individual member states is
precluded.[61]

However, the legislatures of each member state have
never been bound by EMEA decisions.[62] National legislatures cannot be bound by the
decisions of the CPMP and the European Commission, which seriously
impedes the success of the system in reducing inspections and
decreasing time to market. [63]

Other than the EU standardization process, other
early steps toward multinational pharmaceutical regulatory
cooperation were often bilateral, in the form of MOUs between two
countries or organizations. Agreements on good manufacturing
practices existed in the late 1980s between the FDA and
Switzerland, the FDA and Sweden, and the FDA and Canada, and the
FDA had separate agreements on good laboratory practices with
Canada, Sweden, Switzerland, West Germany, France, Italy, the
Netherlands, and the United Kingdom.[64] In 1990, talks began between the FDA and the
European Commission on good manufacturing and laboratory practices
applicable to EC members and the United States.[65]

After 1991, standardization attempts expanded into
multilateral efforts. In February 1991, at the Joint Pharmacopeial
Open Conference on International Harmonization of Excipient
Standards, sponsored by the United States, British, European, and
Japanese Pharmacopeias, participants advocated for uniform
regulation of excipients.[66] Harmonization of health care product naming was
the goal of a November 1991 conference sponsored by the United
States, the EC, and Canada.[67]

Attempts at establishing global standards for
pharmaceuticals were spurred in part by efforts at reducing
barriers to global trade in general. In the past, eradicating trade
barriers such as tariffs and quotas was the main concern. Although
these trade barriers have not been completely eliminated, the focus
in international trade has shifted in part to other barriers to
trade, such as domestic production and manufacturing standards.
These standards encompass rules set voluntarily by industry and
mandatory government guidelines, both of which are enforced by
conformity assessment bodies, either private or governmental, to
certify that the standards are being met.[68] In many ways, the multilateralization of standards
is the natural next step in eliminating barriers to trade, as the
cost of compliance with domestic standards and conformity
assessment procedures can be as prohibitive to international trade
as tariffs.[69]

International agreements, such as the North
American Free Trade Agreement (NAFTA) (1993) and the Uruguay Round
of the General Agreement on Tariffs and Trade (GATT) (1994), which
established the World Trade Organization (WTO), significantly
advanced the movement toward uniform global standards, by moving
beyond routine tariff-reduction measures.[70] NAFTA and the WTO are permanent institutional
structures which address issues like domestic public health, food
safety, consumer, worker and environmental protection policies of
member, all traditionally the purview of domestic government; as
such, these bodies go far beyond ordinary trade agreements focusing
on tariffs and quotas.[71] These agreements address the establishment of
domestic standards, with the intent of preserving the ability of a
government to set national standards, while preventing the use of
such standards to favor domestic products unfairly.[72] The WTO addresses this issue in its Agreement on
Technical Barriers to Trade, and NAFTA does so in Chapter Nine on
Standards-Related Measures.[73] Both restrict the domestic policy aims that member
countries may follow, as well as the tools to be used in
implementing even acceptable domestic policy.[74] Both agreements recognize the right of countries
to implement standards viewed as appropriate for the protection of
public health, safety, and the environment, provided that such
standards will not be used to create unnecessary impediments to
trade. Unnecessary obstacles are assumed when standards making
procedures are not open and transparent; do not provide for public
notice or comment by interested parties; do not involve publication
of the final standard; and fail to establish a method by which
affected parties can ascertain the standards relevant to a given
product. Both also require and create feedback mechanisms on the
effectiveness of the agreements.[75] In making inroads on standardizing what had
previously been almost untouchable as exclusively within the domain
of domestic regulation, NAFTA and the WTO set the stage for the
standardization movement in the regulation of pharmaceuticals.

II. TOOLS OF STANDARDIZATION

There are various models by which countries may
standardize their drug approval regimes, as well as various
mechanisms that can be adapted within the models to further
standardization.[76] These models include: 1) the agent-in-place model,
in which a country is the recipient of a trading partner’s
development work and the country’s regulatory body relies on
that information to assess compliance with U.S. law; 2) the
enforcement discretion model, in which the benefit of the doubt, in
the form of lessened scrutiny, is granted to products of a country
whose domestic regulatory requirements are deemed to be reliable;
3)
the deputy sheriff model, in which one country’s regulatory
agency commits to accept another’s verification of the first
country’s domestic requirements;[77] 4) the equivalence model, in which a state
accepts, in place of its own standards, the regulatory requirements
of another state;[78] and 5) the harmonization model, in which all
involved countries simultaneously modify their regulatory
requirements such that a common approach results.[79] All of these models play a role in the efforts
toward standardization.

Instruments which further these models include
harmonization agreements, equivalence agreements, mutual
recognition agreements (MRAs), exchanges of letters, memoranda of
understanding (MOUs), and procedural agreements.[80] In harmonization agreements, countries test
products to the same international standards, such that further
testing is not required.[81] The International Conference on Harmonization of
Technical Requirements for Registration of Pharmaceuticals for
Human Use (ICH), which will be discussed in depth later, is one
such agreement. The member countries under the ICH still maintain
their own approval processes though.[82] Under equivalence agreements different
regulatory systems are deemed equivalent by the parties, despite
not being identical.[83] In MRAs, regulatory standards of an exporting
country, although different from that of the importing country, are
considered acceptable to the importing country if certain
conditions are met.[84] No further testing would then be required upon
importation from that country. Exchanges of letters set out only
the actions to be carried out by the letter’s
signatory.[85] They are used instead of formal agreements when
the actions to be taken are not significant enough for a formal
agreement and require only limited resource expenditure.[86] MOUs, as discussed later, come in various forms
and can be shaped in various ways to meet the needs of the
situation. Procedural agreements call for adherence to certain
processes when developing regulatory standards, regardless of lack
of agreement on the resultant substantive standards.[87]

Each instrument may be adopted in a range of
manners, allowing for use in adherence with various models of
standardization. For example, the United States uses MRAs in
furthering the equivalence model by requiring equivalence prior to
mutual recognition.[88] However, MRAs could be structured to require
recognition of another country’s work without equivalence,
adhering to the agent-in-place model of standardization.

Over the course of the ongoing drive towards
standardization, all of these instruments have been used. Use of
one instrument embodying a distinct model of standardization has
not meant the exclusion of other instruments embodying different
models of standardization. For example, even while the ICH was
being developed, in 1994 the United States announced the conclusion
of an MOU with Russia effectively making the FDA the regulatory
body for pharmaceuticals in Russia.[89]

All of these instruments may be used both to arrive
at stricter or looser standards. Under full harmonization, all
countries may agree on standards that are in line with the country
with the most stringent regulatory regime, the least stringent
regulatory regime, or anywhere in between. Similarly, at what point
the threshold for equivalence is set will determine the rigor of
the resulting regulatory regime. However, with equivalence
agreements there is the danger that a less strict regime that is
deemed equivalent will serve as a means for pharmaceutical
producers to avoid the more rigorous controls in place in other
countries, weakening the standard of protection rather than
strengthening it as intended.[90]

1. Mutual Recognition Agreements (MRAs)

Generally, an MRA is a trade agreement under which
non-tariff barriers to trade are eliminated to facilitate trade
between the parties to the agreement.[91] The overall goal of an MRA is to make trade
easier without compromising on levels of safety. MRAs generally
involve either reliance on one another’s conformity
assessment system or exchange of results from conformity
assessments to assure that requirements of the receiving country
are complied with where reliance on another’s results is not
practicable.[92] An MRA is a negotiated, reciprocal agreement
between two or more countries under which each recognizes the
others’ "conformity assessment" systems to be of a caliber
such that some types of testing upon importation of pharmaceuticals
are unnecessary.[93] Such agreements establish a framework of
cooperation and trust between the involved regulatory bodies.
Evaluation, testing or inspection decisions of a regulatory
authority in the exporter's jurisdiction are accepted by the
importing country, as long as they are equivalent to those which
would have been made in the importing jurisdiction. The focus is
thus on the capabilities and equivalency of the procedures to reach
the same decisions regarding testing, evaluation, or inspection,
rather than on requiring harmonization of regulatory
requirements.[94] Thus, even though other countries have much less
extensive regulatory capacities than the United States, the U.S.
may declare another country’s procedures
“equivalent” if the U.S. has confidence that that
country’s system will produce the same caliber of
decision-making.[95]

As opposed to the more wide-reaching ICH, MRAs are
generally tailored to solving a particular problem. They are
utilized most often to address situations in which a particular
difference in regulatory regimes is deemed a significant barrier to
trade.[96] For example, the E.U.-U.S. MRA arose in part out
of the US’s fear of the EU becoming a fortress from which the
US would be excluded. As a side benefit, the MRA addressed
increasingly unmanageable enforcement burdens as well.[97] Also, in opposition to the atmosphere of neutral
scientific curiosity that generally marks the ICH, MRAs often
involve negotiations in which a spirit of competitiveness prevails
over cooperation.[98]

It is important to emphasize that MRAs do not
substitute the substantive regulations of a foreign country for
that of the country into which the goods are to be imported; rather
they allow foreign bodies to carry out the procedures by which
adherence to domestic standards is ensured. Specifically, under an
MRA, the United States would permit foreign drug regulators to
inspect that country’s drug manufacturers for compliance with
United States’ regulatory requirements, and the FDA would
then treat these reports as if they came from U.S.
regulators.[99] However, industry groups intend MRAs to be a step
toward equivalence and standardization, as they generally
necessitate some determinations of equivalency.[100] For example, the US-EU MRA requires that both
countries adhere to equivalent manufacturing standards as a
prerequisite for inclusion of products in the MRA.[101] Even while emphasizing that the MRA did not
involve harmonization of drug regulations, the FDA described
harmonization as a natural outcome of an MRA.[102]

In the United States, attempts to establish MRAs
with other countries are headed by the U.S. Trade Representative,
with the involvement of the FDA for agreements on
pharmaceuticals.[103] Conformity assessment systems ensure that a
product meets with a given standard, through means such as product
testing and reporting on the results of quality tests.[104] Thus, the regulatory agencies are relying on
their counterparts in the other countries to assess the conformity
of drugs with safety and efficacy requirements.[105] Since each party recognizes the trials and
approvals issued by conformity assessment agencies of the other
party, products can be exported into the other party's market
without undergoing additional testing.

The United States initialed an MRA with the EU on
June 20, 1997.[106] The MRA entered into force on December 7, 1998
with a three year confidence-building period,[107] after both parties completed domestic
requirements for adoption of the MRA.[108] The MRA is composed of a general Framework
Agreement section laying out the rights and obligations of the
parties, as well as sector-specific annexes, including one on
inspections in pharmaceuticals.[109] It calls for mutual acceptance of products made
at sites that have passed inspection that adhere to international
pharmaceutical manufacturing standards, known as Good Manufacturing
Practice (GMP), which ensure the purity and quality of the final
drug product.[110] Under the MRA, the FDA is to determine whether
the regulatory systems of EU members are equivalent to that of the
US, after which those nations can import pharmaceuticals into the
US without submission to the FDA for further testing of products
produced under GMP standards.[111] The GMP Annex of the MRA defines "equivalence"
as involving "systems [that] are sufficiently comparable to assure
that the process of inspection and the ensuing inspection reports
will provide adequate information to determine whether respective
statutory and regulatory requirements of the authorities have been
fulfilled;] Equivalence does not require that the respective
regulatory systems have identical procedures."[112] Activities implicated in assessing equivalence
include exchanges of information, joint training, and joint
inspections between the FDA and its EU Member States’
counterparts.[113] Equivalence determinations by both parties are
to be made after the three year transitional period, based on the
evidence gathered during the transitional period.[114] These assessments will be carried out by a Joint
Sectoral Committee, chaired by a representative of each party, and
the Committee will generate a list of equivalent authorities. In
the pursuant operational stage, GMP inspection reports will be
exchanged between equivalent authorities, which in most cases will
be endorsed by the receiving party.[115] Eliminating the need for duplicating tests,
inspections, and certifications is expected to bring a cost savings
of more than $1 billion each year to United States manufacturers,
which amounts to the equivalent of a two to three percent tariff
reduction.[116]

The FDA requires equivalence as a prerequisite to
an MRA. As such, the FDA often uses MRAs to deepen an already
existing MOU relationship.[117] MRAs generally specify the ongoing procedures by
which the countries will recognize the results of tests carried out
by the other party’s regulatory body. An MRA sets out the
requirements a regulatory agency must meet for recognition, as well
as the range of products to be covered under the
agreement.[118] Equal access to markets is to be afforded to all
products covered by the MRA. If barriers to such access arise, the
parties must consult on how best to resolve the issue.[119] In the absence of resolution, the agreement may
be dissolved by the complaining party after a certain amount of
time.

Given the highly technical nature of MRAs and the
scope and nature of the negotiations they thereby require, such
agreements are not optimal in all situations.[120] fact, MRAs are only practical and effective when
a trading relationship is one in which the nations have regulatory
structures that are similar in scope and structure, the countries
have a significant amount of trade in the particular industry to be
covered, and the standards differential has become a contentious
trade issue between the nations.[121] For an MRA to be appropriate, the trading
partners to be covered should both have regulatory systems that are
similar in scope and structure and should conduct a large amount of
trade in the industry to be covered.[122] Furthermore, due to the scope and nature of
negotiations involved in concluding an MRA, the standards to be
regulated should have become contentious issues.[123]

Even if these factors are present, an MRA may still
encounter problems in implementation, such as those already
experienced with the EU-US MRA. The transitional period of the MRA
had been marked by ambivalence. Because of the voluntary nature of
the MRA, manufacturers can opt to use conventional FDA or
EU-equivalent inspections.[124] The EU did not supply the US with a list of
conformity assessment bodies (CABs) until four months after the US
submitted its own list of nominees. Additionally, CABs charge fees
based on the number of manufacturers it serves, and certification
of the EU CABs will cost the FDA about $18 million in
training.[125]

Memoranda of Understanding (MOUs) are another tool
used in standardization of regulatory regimes. MOUs are sometimes
referred to as Notes Verbale or Arrangements. MOUs promote
standardization of laws, regulations, and enforcement
actions.[127] Like the other standardization tools, MOUs are
intended to ensure the safety and efficacy of pharmaceuticals, to
enhance efficiency of resource utilization, and to further
communication between regulatory bodies on covered drugs.[128]

MOUs can be structured in various ways, depending
on the nature of the parties’ systems and
relationship.[129] Not all MOUS are reciprocal and therefore do not
always offer the same benefits to each side.[130]

One type of MOU that is most useful with countries
having the same or similar systems offering approximately the same
level of protection is a reciprocal agreement setting up the mutual
assessment of a foreign regulatory system or measure’s
comparability.[131] These MOUs may be very similar to MRAs or
equivalence determinations, with the scope of activities covered
ranging from mutual acceptance of data and inspection results to
acceptance of the regulatory system such that the tests and
inspections of imports may be reduced.[132] Several longstanding MOUs, for example those
between the U.S. and Canada, and the U.S. and Sweden, have mutual
recognition components, added after the FDA has determined that
that the other country’s regulatory system is of a caliber
that the FDA can safely reduce inspections of products from that
country.[133]

MOUs may also cover certification criteria for
regulated products.[134] In the past, these agreements have been limited
to products with inherent or consistent safety issues.[135] More recently, they have been extended to
products with a good compliance history.[136] This type of MOU can be used to direct the
exporting country as to what controls to use to ensure reliable and
valid certification, with the goal of reducing the need for
inspections and samplings upon import of the products.[137]

Yet another type of MOU establishes formal means of
communication between signatories. Enhanced communication
facilitates the exchange of technical, regulatory, and scientific
information, improving decision-making by both parties and limiting
resources needed for monitoring.[138] Employees may also be exchanged, as well as
information. These MOUs are generally limited to a specific time
period.[139]

There are several other varieties of MOUs. A
cooperation MOU fosters cooperation and
information-sharing.[140] A compliance MOU requires compliance of the
exporting country with the standards of the importing company. An
equivalents MOU finds the regulatory system of another country
equal to the FDA’s.[141]

The FDA has turned to MOUs in the face of increases
in imports that need to be examined by the FDA. Import shipments
have increased from 500,000 in 1970 to 3,700,000 in 1996. The FDA
negotiated MOUs to have other countries take on the burden of
ensuring that FDA requirements were met before the products were
sent to the U.S. As of 1996, the FDA had negotiated almost fifty
MOUs.[142]

In 1995, the FDA published a new compliance policy
guide, “International Memoranda of Understanding,”
setting forth guidelines for initiating, developing, and monitoring
MOUs between the FDA and with other countries.[143] These guidelines were developed at the
recommendation of the FDA’s International Harmonization Task
Force, to explain the FDA’s aims in forging MOUs and to
promote uniformity in the establishment of MOUs.[144] The guide stresses the need to maintain
flexibility in negotiating MOUs to accommodate different approaches
to regulation.[145]

The FDA pursues MOUs with foreign governments or
organizations when such agreements will advance the state of
domestic public health by improving FDA’s capacity to ensure
the safety, quality, and effectiveness of products, allowing the
FDA to capitalize on its resources most effectively without
compromising public safety, and enhancing communications with
foreign regulators.[146] Particularly, the following factors are
considered in deciding whether to initiate MOU talks: health
benefits, including risk reduction, of products and programs; to
what extent a product is imported into the United States; the
degree to which a proposed agreement will remedy past compliance
issues; the extent to which the costs of the program will outweigh
the benefits;[147] the resulting reduction in industry’s
regulatory burden; and the broader international policy objectives
of the United States.[148]

FDA negotiates MOUs pursuant to the Department of
State’s Circular 175 procedures governing clearance of Agency
agreements with foreign powers.[149] Before making equivalence determinations
regarding procedures and enforcement mechanisms of other parties,
the FDA checks whether such procedures are in fact equivalent in
the level of safety and efficacy they provide.[150] On-site visits, among other techniques, are used
to ascertain whether the authorities, product standards,
capabilities, and infrastructure of the foreign country make it
feasible for that country to meet the terms of an MOU.[151] An MOU generally lasts for 5 years, during which
it is reviewed at least once to determine whether modifications are
needed and if it should be continued or cancelled.[152]

The FDA uses a three-phase process in developing an
MOU with a foreign country, involving coordination between the
sponsoring center or office, the Office of Regulatory Affairs
(ORA), and the International Affairs Staff/Office of Health Affairs
(IAS/OHA), and the Office of Policy (OP).[153] First, the feasibility of such an MOU is
evaluated. The sponsoring center or office explains in writing to
the ORA how the proposed MOU would further FDA goals. The FDA
determines whether the other party will be capable of carrying out
the proposed MOU, potentially through an exchange of information on
laws, standards, and inspection and sampling procedures and through
on-site visits to various facilities. If the FDA decides that the
other party does not have an adequate infrastructure to
successfully participate in the MOU, a letter to that effect,
approved by the OP and IAS/OHA, is sent to that party, and talks
are suspended until the specified concerns are addressed.[154]

Second, effectiveness must be determined. Sometimes
an informal confidence-building trial period is conducted under a
draft MOU. The protocol detailed in the draft may include: a
program description, information about relevant government and
private organizations’ roles and capabilities, possible
certification issuance and use, procedures relating to audit time
frames and metrics, and necessary training and information.
Regardless of the conduct of a trial, the FDA can use inspections,
alone or with the other party, and analysis of imported products to
assess program effectiveness.[155]

In the third stage, the substance of the MOU is
finalized. Rulemaking is conducted if necessary. The MOU is then
ready for official clearance. Procedures by which to audit the MOU
are developed by the sponsoring center or office and are
disseminated to field offices by the ORA.[156]

The FDA MOU with Russia, announced by the FDA on
February 14, 1994, effectively makes the FDA the regulatory body
regarding pharmaceuticals for Russia.[157] Under the MOU, the Russian Ministry of Health is
obligated to grant permission for the free marketing of U.S.
pharmaceuticals within ninety days of the provision of the
applicant company’s financial information, an FDA approval
letter and package insert for the product, a statement showing
compliance with FDA GMP, and a copy of the FDA manufacturing
facility inspection report.[158] No longer is further review or testing necessary
and no translation of the underlying data into Russian is
required.[159] This dramatically speeds up the entry of U.S.
drugs into the Russian market. Prior to this agreement, U.S.
pharmaceutical companies often had to repeat animal and human
clinical trials, have all submitted papers, which often comprised
over a thousand pages, translated into Russian, and wait undefined
periods for approval decisions to be made.[160] This would allow the United States a comparative
advantage in increasing its market share in the Russian
pharmaceutical market.[161] Furthermore, the formal recognition of the
worldwide esteem in which the FDA was held, was a boost to FDA
self-esteem and validation of the high-standards it claimed to
uphold.[162] Humanitarian concerns for getting treatments to
those that needed them in Russia were also cited.[163]

From the Russian viewpoint, the pact provided
Russians with much needed pharmaceuticals that were in short supply
in Russia.[164] The Russians also hoped that U.S. companies
would hire Russian clinicians to conduct lower cost drug trials in
new facilities in Russia and that such a pact would promote joint
ventures to sell Russian products.[165] Russia’s decision to essentially
substitute the FDA for a domestic regulatory agency can be viewed
as a response to a weak domestic pharmaceutical industry,[166] the quality problems suffered by domestic drug
producers, and the lack of resistance to such action from any
internal community.[167] Rather than sink limited resources into an
expensive revamping of its own unsuccessful regulatory agency, the
Russian ministry of health ceded authority to the FDA. Furthermore,
the MOU frees up limited Russian resources to concentrate on other
more problematic goods entering the country from other parts of the
world.[168]

B. Multilateral Efforts: The International Conference on
Harmonization of Technical Requirements for Registration of
Pharmaceuticals for Human Use (ICH)

1. Goals of the ICH

The ICH was conceived at a conference between the
regulatory officials of the EU, Japan, and the U.S. and the
International Federation of Pharmaceutical Manufacturers
Associations (IFPMA) in 1989[169] and initiated in 1990 to achieve convergence of
the pharmaceutical regulatory regimes of the U.S., the EU and
Japan.[170] The project brings together representatives of
the regulatory bodies of each of the three companies, as well as
industry experts from these countries, to discuss scientific and
technical issues regarding drug registration.[171] Three government bodies, the European
Commission; Japanese Ministry of Health and Welfare; and U.S.
Center for Drug and Biologics Evaluation and Research (an office of
the FDA), and three pharmaceutical industry trade groups, the
European Federation of Pharmaceutical Industries Association;
Japanese Pharmaceutical Manufacturers Association; and
Pharmaceutical Research and Manufacturers of America comprise the
ICH.[172] The ICH is different from other moves toward
standardization, such as those promoted by the WTO, as it has a
recognized status and is supported by industry groups and
regulatory bodies.[173]

The ICH is programmatic in that it contemplates a
wide-ranging plan to address all areas of pharmaceutical regulation
in an institutionalized solution.[174] The program is based on the notion that the core
of drug development is asking key questions and trying to answer
them with studies that demonstrate to regulatory authorities with a
given level of confidence the safety, efficacy, and quality of the
resulting products. This principle, that drug development can be
broken down into scientific principles and technical requirements
to which best scientific practice can be applied, suggests that the
development of international standards for pharmaceuticals is the
logical outcome of adherence to such a principle.[175] The goals of ICH, set out in a statement by the
ICH Steering Committee, are threefold.[176] First, standardization is sought as a means to
avoid wasteful duplication in developing new drugs, without
compromising levels of safety and efficacy,[177] or to ensure that “good quality, safe and
effective medicines are developed in the most expeditious and cost
effective manner.”[178] Specifically, standardization would reduce the
need for animal, human, and material, including monetary,
resources.[179] Second, ICH is intended to reduce the time to
market of new drugs. Third, ICH will maintain the levels of safety
and efficacy currently in place. ICH activities have also been
touted as means to reduce the spread of disease, both within and
between countries, and to improve information exchange between
countries on health issues.[180] In enacting these measures, the best interests
of the patients, public health, and the consumer are to be
paramount.[181]

2. History of the ICH

ICH conferences have been held in Brussels, Belgium
(ICH1) (1991), Orlando, Florida (ICH2) (1993), Yokohama, Japan
(ICH3) (1995), Brussels (ICH4) (1997),[182] San Diego, California (ICH5) (2000),[183] and ICH6 is planned for 2003.[184] ICH1 produced a procedure by which to promulgate
harmonization guidelines.[185] A Steering Committee composed of two
representatives from each region plus two non-voting
representatives of the International Federation of Pharmaceutical
Manufacturers Associations (IFPMA) was constituted to direct and
oversee all ICH activities, which in turn established a system of
Expert Working Groups (EWGs), joint regulatory/industry bodies, to
establish priorities and draft guidelines.[186] The first phase of ICH, which ended with ICH4 in
Brussels, focused on decreasing duplication in the development
process by standardizing technical guidelines. The second phase
focuses on consolidating, updating, and promoting the acceptance of
the Guidelines that grew out of the first phase,[187] as well as preventing future problems through
early collaboration on newly emerging issues.[188]

3. Organizing Documents of the ICH

The ICH sets out its mission in the “Terms of
Reference” under which it operates.[189] Apart from ascertaining where increased
standardization could produce a more economical use of resources
while maintaining quality and safety levels, the ICH serves as a
forum for regulatory agencies to converse constructively with
industry groups and to recommend practical steps toward
standardization of the registration process.[190] Rather than ostensibly seeking harmonization of
the regulations governing the approval process or a common
application process, the ICH aims to standardize the drug testing
guidelines such that data produced therein would be acceptable
across countries.[191] Achievement of ICH’s aims would obliterate
the need for drug producers to duplicate trials, while still
requiring that each country’s application process be
followed.[192] Inevitably, a quite similar regulatory process
will result if ICH is successful.

4. Structure of the ICH

The current ICH structure includes a Secretariat
and Coordinators, in addition to the Steering Committee and the
EWGs.[193] The Steering Committee currently has a
representative from each of three observers, the World Health
Organization (WHO), Canada (represented by the Health Canada Drugs
Directorate), and the European Free Trade Area ((EFTA) represented
by Switzerland), in addition to the original members to provide
input from non-represented states.[194] The Steering Committee meets at least twice a
year, rotating locations among member regions. At these meetings,
the Committee considers new topics for harmonization, hears status
reports on works in progress, and discusses maintenance of existing
guidelines.[195] Representatives from the generics industry, the
over-the-counter (OTC) industry, and pharmacopoeial authorities
have been invited to some of the EWGs in recognition of their
interest in the outcome of the ICH.[196] In March 1999, a subcommittee of the Steering
Committee, the ICH Global Cooperation Group (GCG) was formed to
provide information on ICH, ICH activities, and ICH guidelines to
any country’s regulatory authority or any pharmaceutical
company that requests the information. The subcommittee is
constituted of one representative of each of the six parties on the
Steering Committee, the ICH Secretariat at IFPMA, and observers
from the WHO and Canada.[197] The Secretariat, provided by the IFPMA and
acting from the IFPMA offices in Geneva, supports the Steering
Committee’s activities, with help from a coordinator from
each party. The Secretariat is funded by conference proceeds and
industry contributions, while each member funds its own
participation in ICH activities, including travel expenses, special
investigations, and experiments. Five major conferences have been
held apart from Steering Committee meetings, with the aim of
providing updates on ICH activities and assessing public
opinion.[198]

5. ICH Procedure

Topics for standardization are proposed by a party
in a concept paper, which details the need for harmonization and
the proposed task and timetable of an EWG. If the topic is accepted
by the Steering Committee, an EWG is comprised to develop
harmonization guidelines.[199]

At ICH conferences the parties engage in regulatory
negotiation, also known as negotiated rulemaking, in which parties
aim to develop regulation guidelines on which all participants can
agree.[200] Cooperation is intended to be placed above
competition, as the participants engage in a neutral scientific
inquiry.[201] The notice and comment period about the
resulting compromise proposal should therefore be streamlined and
parties are less likely to challenge such a proposal in court once
it has been accepted.[202]

The ICH process for generating standardizing
proposals can be divided into five steps which are carried out
primarily by working groups between conferences.[203] First, in the consensus-building stage, the
Expert Working Groups (EWGs) select and prioritize topics for
standardization.[204] The EWGs forward a draft guideline, policy
statement, or similar document to the Steering Committee.[205] Second, regulatory action starts when the
Steering Committee determines based on the EWG report that there is
enough consensus to proceed and the members from each country
regulatory group assent.[206] At this point, proposed ICH guidelines are
published for comment on the ICH and member parties’ web
sites.[207] Third, during the regulatory consultation stage,
each member regulatory agency has sixth months to exhaust its own
consultation procedure.[208] Such consultation processes usually involve
soliciting comments from citizens, academics, and industry groups,
among others.[209] In the United States, proposed guidelines are
published for comment in the Federal Register.[210] Comments from each agency are incorporated into
the draft and passed to the EWGs for approval before submission to
the Steering Committee.[211] At this stage, industry associations and
regulatory authorities in non-ICH regions have a chance to comment
on the draft documents which are distributed using IFPMA and WHO
contact lists.[212] A Regulatory Rapporteur is designated to meld
the drafts together and have the regulatory body representatives
sign-off on the final document.[213] Fourth, the Steering Committee adopts and
recommends the final version to all parties for their
adoption.[214] Fifth, the parties incorporate the final
guidelines into their domestic pharmaceutical regulations.[215]

A guideline produced by the ICH is not binding on
its members, as it lacks the force of a treaty or an international
accord. Rather, "it represents a firm political commitment on the
part of the concerned governments."[216] For implementation of its guidelines, the ICH
relies on their integration into domestic law by the regulatory
agencies of each country.

6. Progress of the ICH

Topics to be harmonized are classified as within
the category of Safety, Quality, or Efficacy, the three criteria on
which approval of new drugs is based, or
Multidisciplinary.[217] “Efficacy” includes clinical testing
programs and safety monitoring, “Quality” includes
pharmaceutical development and specifications, “Safety”
includes pre-clinical toxicity and related tests, and
“Multidisciplinary includes topics effecting more than one
area, such as regulatory communications, including electronic
communication, medical terminology, timing of toxicity studies in
relation to clinical studies, and the Common Technical Document
(CTD)). Eleven guidelines have been published regarding Efficacy,
with three more in final stages of development. Efficacy guidelines
have the potential to be the guidelines with the most impact, since
clinical trials are the most resource intensive part of drug
development. For example, with the implementation of “Ethnic
Factors in the Acceptability of Foreign Clinical Data” (E5)
after its publication in February 1998, drug companies were able to
avoid repeated trials to account for ethnic differences across
countries. Pfizer benefited from this guideline in its introduction
of Viagra in Japan.[218] However, the impact has been undermined by the
U.S. and Japan’s reluctance to accept data from other
countries, with Japan in particular requiring extensive use of
bridging studies that are supposed to only be conducted in rare
cases under E5.[219] E5 has already been adopted by some non-ICH
countries, such as Taiwan and South Korea.[220] The “Good Clinical Practice: Consolidated
Guideline” (E6), which underlies E5 by requiring adherence to
the same rigorous clinical standards across countries, has already
effected regulatory change in member countries. “General
Considerations for Clinical Trials” (E8), finished in July
1997, details internationally accepted principles of trial design,
facilitating the acceptance of data across countries. [221] According to a 1997 ICH Utilization Survey,
based on only seven available Efficacy guidelines, industry use of
the guidelines in the EU 62%, Japan had 77% utilization, and the US
had 85% utilization, with industry reporting a positive impact on
drug development programs.[222] Specifically, industry responses noted that the
guidelines facilitated intra-company globalization and some,
although not total, reduction of duplicate research.[223]

The fourteen finalized Quality guidelines focus on
stability, specifications, and analytical methods evaluation.
Recommendations on stability data and impurities, two key areas of
bulk drug and drug product quality, have reduced the duplication of
tests. For example, specifying a particular temperature at which to
run stability tests, rather than just conducting them at room
temperature, eliminated the need for additional tests for each
climate.[224] The 1997 ICH Utilization Survey, based on the 11
guidelines in this area then completed, reported 77% average
utilization and a reduction of duplication in reserach.[225] The reported regulatory issues were then
addressed in revisions of the relevant guidelines.

Safety guidelines, covering all the major types of
pre-clinical toxicity testing and focusing on standardizing study
length, content, species requirements, dose selection and

exposure levels to improve the risk/benefit
assessment, have increased the acceptability of the studies in this
ethically sensitive area. Standard batteries of tests have been
developed for each type of toxicity study. Utilization rates as of
the 1997 survey, when seven guidelines had been implemented was
80.5% over the three regions, with the EU reporting 77%
utilization, and with Japan and the US both reporting 82%
utilization.[226]

The Common Technical Document (CTD) and the Medical
Dictionary for Regulatory Activities Terminology (MedDRA), a
standardized terminology for the reporting of Adverse Drug
Reactions, are the most important and most ambitious
Multidisciplinary guidelines. The CTD is a product of three EWGs
promulgating a single format for the technical section of a new
drug dossier.[227] The CTD, which creates a standard format and
content for new product applications, is the logical outgrowth of
agreement on technical guidelines for generating the reporting
data.[228] Currently, reformatting the submissions from
U.S. to EU standards takes two to six months, according to one
study.[229] This common document will dramatically reduce
number of man hours needed to take data and present it according to
various countries’ requirements. The CTD is also expected to
lead to reductions in review times by regulatory agencies and hence
faster times to market. An e-CTD will further speed
submissions.[230]

Several guidelines have been incorporated into
domestic regulations of the member states, and the latest survey
data shows that the guidelines have reduced research
duplication.[231] These guidelines cover: 1) reproductive toxicity
in animals, 2) clinical studies in which the elderly are subjects,
3) testing the stability of new active substances, 4) dose response
information in support of drug registration,[232] and 5) good clinical practices, including
preparing, monitoring, reporting, and archiving clinical
trials.[233] As of January 2000, 37 guidelines had been
produced and are in the process of being implemented.[234] The ICH is continuing to maintain current
guidelines, as well as develop new ones. The Common Technical
Document, along with its electronic version, is expected to allow
multiple submissions to be replaced by one technical dossier for
all three regions, encouraging simultaneous submission, approval
and launch of new drugs. The ICH is disseminating guidelines via
its web site as well as the sites of members for use by other
countries too.[235]

III. CRITIQUE OF THE INTERNATIONAL STANDARDIZATION
EFFORTS TO DATE

International standardization efforts have been
criticized in several respects. At the most general level, the
feasibility and desirability of standardization as an end goal has
been attacked. More specifically, the tools of standardization,
multilateral and bilateral, have been denigrated. Some criticisms
of the tools of standardization echo the problems cited with the
overall standardization process. However, some problems are
specific to the ICH and MRA processes as vehicles for
standardization.[236] I address both levels of criticism in turn.

A. Critique of Standardization as an End Goal

The most fundamental critique of the
standardization movement attacks the idea that standardization is
the desired outcome. Opponents of standardization argue that: 1)
standardization is unattainable in a world with cultural diversity;
2) standardization will only bring about a reduction in standard
stringency; and 3) standardization reduces government
accountability to citizens.

First, critics contend that standardization is
predicated on the notion that there is an attainable universal
standard. However, this may not be the case in the face of cultural
and geographic diversity, giving rise to different levels of
tolerable risk. For example, standard-setting takes into account
objective variables, such as use of a particular product, which
vary by place and culture. Therefore, in a culture in which it is
the norm to take aspirin every day, the risk presented by the
adverse effects of aspirin will be much different than in a culture
in which taking aspirin is shunned.[237]

Second, there is a fear that standardization will
reduce international regulation to the level of the least
restrictive country. For example, the WTO and NAFTA instruct
countries to use risk assessment, a process by which a level of
risk deemed tolerable is chosen, in setting standards. However, the
United States often chooses instead to base many regulations
regarding pharmaceuticals on a policy of zero tolerance of a risk,
forbidding public exposure to a risk completely. A policy of zero
tolerance is safer for consumers, but problematic under NAFTA and
the WTO.[238] Therefore, the goal of standardization as a
whole has been criticized as undermining the safety of United
States’ citizens.

International standards thus serve as a ceiling,
rather than a floor; while provisions exist to challenge stricter
standards, no such provisions exists to contravene those who fall
below international standards. Under these international regimes,
members who deviate from international standards have the burden of
proof to defend stricter standards from charges of interfering with
trade. Stricter domestic standards must pass a range of tests to
avoid being classified as trade barriers. The incentive under these
regimes is to avoid setting safety standards in excess of
international standards, even if stricter standards would save
lives. Fear of trade sanctions that would interfere with lucrative
international trade under the WTO and NAFTA thus impede the
development of novel solutions to public health issues. [239]

Third, the development of global standards reduces
the accountability of individual governments to their citizens.
Decision-making is removed from more accountable state governments
to international bodies largely inaccessible to citizens. These
bodies determine the risk level that citizens are to live with in
the absence of significant input from those affected by the
standards. Due to the inaccessibility of these agencies to
citizens, industry is able to exert a disproportionate influence on
standard setting.[240]

B. Critique of the Various Tools of
Standardization

1. Criticism of MRAs as a Tool for
Harmonization

MRAs have been criticized by business and consumers
alike. Businesses are concerned that MRAs will not properly protect
proprietary information of pharmaceutical companies, and that such
business secrets will be disclosed to competitors through
agreements dictating data-sharing between governments. For example,
the 1997 US-EU MRA prescribes that the FDA has the discretion to
claim confidential status for certain data that it submits to
foreign governments for approval under the MRA. Yet, it is within
the FDA’s discretion to choose which data to mark as private.
There is no effective remedy for halting such disclosure, as once
the information has been let out any compensation is likely to
prove inadequate.[241]

Consumers worry about the extent to which MRAs will
lack consumer input. The equivalence determinations made as part of
MRAs will have a great effect on which drugs are allowed into a
market. Consumers often have little impact on which regulations are
declared equivalent. Few regulatory bodies solicit consumer
feedback in making equivalence decisions. The FDA, for example,
does not request consumer comments and makes equivalence
determinations behind closed doors, in marked contrast to their
policy of early notice and comment with regard to food product
equivalence determinations. Consumers also worry that they will be
denied access to the documents upon which equivalence assessments
are made until after equivalence is granted; if it is denied, all
documents will be sealed. Availability of documents currently
accessible by the public might also be compromised under MRAs as
not all foreign countries have Freedom of Information acts or
require recall information to be published as does the United
States.[242] When foreign inspectors take on regulatory
duties on behalf of the U.S. under MRAs, consumers worry that they
will not be given access to the resulting documents.

More basically, consumers are worried that safety
standards will not be upheld given the existence of MRAs. To
prevent firms from seeking approval in countries with the least
restrictions and then getting recognition of the decision in other
nations, MRAs should only be concluded if regulatory systems are
really equivalent.[243]

2. Problems with the ICH as a Means of
Standardization

There are many criticisms of the ICH process.
Specifically the goals of the ICH, the inclusiveness of the
process, the scope of the issues to be standardized, and the pace
of harmonization have all come under attack.

The goals of the ICH and the metric used to assess
progress is not clear. While success of the ICH seems to be
measured in decreased costs to the consumers and/or manufacturers,
it is unclear that decreased costs will be the result of
standardization. If the United States succeeds in setting the
safety level for pharmaceuticals, countries worldwide will need to
impose stricter regulations on drugs produced domestically to bring
their standards in line. These additional requirements will
necessitate higher costs, as is evidenced by the increased costs in
the United States incident to each new FDA regulation.[244]

Likewise, a major goal of the ICH is to reduce time
to market for drugs entering a new market. Standardizing
regulations would not necessarily accomplish this goal.[245] The ICH is not intended to create a common
approval application. Even with the implementation of the Common
Technical Document (CTD), only the form of submitting data will be
standardized, not the data required.[246] Therefore, producers still need to comply with
various approval application procedures in each market they wish to
enter.[247] There is the danger that the ICH will become
another layer of regulation to pass, another level of red tape to
break through, increasing the time from development to
marketing.[248]

Echoing concerns about harmonization as a goal,
consumer watch groups decry the lack of input from interested
individuals and affected communities, which they claim results from
industry-dominated working groups that meet behind closed
doors.[249] Even though standardization can be beneficial to
both consumers and producers, consumers and producers are not
necessarily benefited by the same types of standardization. For
example, while elimination of duplicative regulatory requirements
reduces costs to producers, producers may not pass these cost
savings on to their consumers, and the elimination of some types of
testing may result in less safe drugs reaching consumers.

Although anyone willing and able to pay the
registration fee can attend ICH conferences,[250] no formal mechanism exists to incorporate
comments from the floor into the formal proceedings or to respond
to such comments.[251] Beyond comments from the floor, there are no
other means by which an individual not involved in the ICH Steering
Committee or EWGs can present his opinion.[252] Further, although individual countries publish
draft ICH guidelines and final ICH guidelines for comment pursuant
to their internal regulatory procedures, such feedback opportunity
is not mandated by the ICH; draft guidelines only need be submitted
for consultation to the regulatory body of each participating
country.[253] If a given country’s procedure does not
require notice and comment, no public opinion is solicited.

With regard to the scope of the ICH, critics claim
that there are a whole host of issues to be resolved in the quest
for international standardization that are not addressed by the
ICH. The ICH deals mainly with scientific aspects of pharmaceutical
regulation.[254] However, as mentioned in discussing problems
with standardization as an end goal, differences in cultural views
of drugs must be confronted before a truly global market is
achievable. For example, Asian views toward medicine and health
lead to unwillingness to adhere to strict clinical testing
protocols, leading Western nations to look upon the resultant data
with skepticism. As another example, Americans are unwilling to
accept any risk in pharmaceutical products. The ICH also fails to
deal with the political and economic forces that influence the
regulatory bodies in various countries.[255] These issues have been impediments to
harmonization of drug regulations across the EU, a less
heterogeneous cultural and political area than the three ICH
regions.[256]

The pace of implementation is another concern.
Since the guidelines produced by ICH do not have the binding force
of treaties, there is no mechanism for implementation other than
each country pursuing its usual procedures for adopting
regulations. As such, there is fear that implementation will be
extremely slow.[257] Also, the lack of enforcement power in the
central ICH institutions create a vacuum which may be too tempting
for member states to try and fill. Political wrangling and regional
distrust would subvert the drive towards a faster drug approval
process that optimally protects consumers.[258]

Specifically, some fear that the ICH will be
plagued with the same problems that faced the EU’s attempt to
centralize and standardize its drug regulations. The EMEA, the
EU’s regulatory body for pharmaceuticals, is tasked with
facilitating harmonization, not imposing it. Likewise, the ICH is
envisioned as a provider of the infrastructure for cooperation. The
fear is that the ICH will have just as much difficulty as the EU in
getting countries to implement common procedures absent binding
authority. While the EU might be forced to grant decision-making
power to the EMEA, it is highly improbable that that would be an
option for the ICH.[259]

IV. THE FDA AND STANDARDIZATION

A. FDA’s Attempts to Facilitate
International Standardization

Within the United States, Congress has recognized
that the imperative nature of increased efficiency in the drug
approval process is as important as maintaining proper safety
precautions.[260] In the “findings” section of the
Food and Drug Administration Modernization Act of 1997 (FDAMA),
legislation intended to speed up the drug approval process,
Congress acknowledged that "prompt approval of safe and effective
new drugs and other therapies is critical to the improvement of
public health, so that patients may enjoy the benefits provided by
these therapies to treat and prevent illness and disease."[261]

The FDA has been tasked by Congress with
facilitating international standardization of pharmaceutical
regulations. In section 410 of the FDAMA, Congress mandated that
the FDA pursue standardization.[262] In this legislation, the FDA is called on to
"support the Office of the United States Trade Representative ...
in meetings with representatives of other countries to discuss
methods and approaches to reduce the burden of regulation and
harmonize regulatory requirements if... such harmonization
continues consumer protections consistent with the purposes of this
Act. ”[263] The FDAMA added two objectives to the
FDA’s mission: to "participate ... with representatives in
other countries to reduce the burden of regulation, harmonize
regulatory requirements, and achieve appropriate reciprocal
arrangements;" and to "carry out [its mission] in consultation with
experts ... and in cooperation with consumers, users,
manufacturers, importers, packers, distributors, and retailers of
regulated products." [264]

The FDA itself has manifested its commitment to
international standardization through increased cooperation with
the standardization process.[265] The FDA leadership council recently added
international consultation and cooperation to the five fundamental
principles of FDA’s public health mission.[266] The FDA also published a Policy on Standards
regarding the agency’s standardization efforts,[267] in which it acknowledged that it must adhere to
international standards in its domestic regulations, unless those
standards are "ineffective or inappropriate."[268] The Policy emphasizes the importance of
openness, transparency, and public involvement procedures for
standard-setting in which the FDA is to participate.[269] Furthermore, as of 1997, the FDA had published
over fifty notices regarding draft ICH guidelines and other
harmonization-related issues.[270]

To further the imperative of international
standardization, the FDA has followed the suggestion of the
President’s Council on Competitiveness that the FDA
increasingly rely on foreign data, and loosened its approval
requirements to allow approval after the completion of one domestic
clinical trial by an investigator trusted by the FDA.[271] The FDA thus acceded somewhat to the drive for
acceptance of the products of foreign regulatory systems while
still ensuring the safety and efficacy of proposed drugs.[272]

The FDA has also testified before Congress in
support of standardization efforts.[273] For example, to alleviate fears about the
advisability of U.S. commitment to MRAs, the FDA stressed in
testimony before the House that the FDA initiated the drive toward
shared inspections with the Europeans and that the FDA is not
compromising its standards.[274]

B. Critique of FDA Participation in International
Standardization

Despite the abovementioned actions on behalf of the
FDA, some people still feel that the FDA is not taking appropriate
action to facilitate standardization. The FDA has been criticized
for its failure to wholeheartedly pursue international
standardization. The FDA justified its reluctance to accept
completely the results of foreign trials by citing the less
detailed judgment and measurement of efficacy in foreign research
protocols, the lack of familiarity of foreign researchers with
close monitoring through recorded data, the reluctance of esteemed
foreign researchers to follow guidance from sponsors, the
cross-cultural differences in human interpretation of statistical
norms and computer programs, the inclusion of less data in trial
reports in other countries, and the lack of conviction of foreign
companies in FDA standards.[275]

In all manifestations of its pursuit of
standardization, including conclusion of MRAs; signing of MOUs; and
participation in the ICH, the United States and the FDA have been
criticized by adherents of standardization. Generally, U.S. and FDA
participation is denigrated as superficial attempts to maintain
power over international standard-setting regarding
pharmaceuticals. For example, one commentator observed that it
"appeared to the EU at times that what 'MRA' meant to the U.S. was
'my regulations apply."' [276] Similarly, critics decry the MOUs the FDA has
entered into as just another means for the FDA to exert control
over other markets, exporting its own standards rather than working
towards standardization.[277] FDA’s pursuit of MOUs with individual
countries has been criticized as a means by which the FDA can say
it is pursuing standardization, while still dictating the terms of
inspection and safety levels.[278] These claims are buttressed by the reality that
under MOUs, the FDA’s involvement in foreign regulations
increases, as often foreign inspectors need training to be able to
implement FDA standards abroad.[279]

Furthermore, critics claim that the FDA would
prefer that it be in charge of standardization in place of the ICH
or other international bodies.[280] In line with that allegation, the FDA has been
charged with not allocating sufficient resources to participation
in the ICH, instead having employees work on ICH issues in addition
to their other responsibilities.[281] Such staffing is said to be in line with the
feeling of some people within the FDA that standardization takes
away from the primary goal of the FDA of drug review.[282]

The actual process that the FDA uses to implement
ICH guidelines has also been attacked. Criticism that the ICH
process does not allow for enough input by affected parties other
than government and industry groups has also been levied against
the FDA in its procedure for adopting ICH guidelines. Although the
FDA publishes draft guidelines for notice and comment before
adopting the guidelines and then publishes the final guidelines for
comment, this procedure has been decried as inadequate to allow for
consumer input in the situation. The four to twelve weeks allowed
for comments on the draft guidelines has been deemed inadequate for
anyone not intimately involved in the development of such complex
guidelines to master them to the degree necessary to comment
intelligently on them. Such a process therefore only gives the
illusion of soliciting input by affected parties not involved in
the ICH conferences, while in reality such input is denied.

This lack of actual input is exacerbated by the ICH
protocol in which all substantive work on the guidelines are
completed before the draft is published by the FDA. So even if
comments were to be received by the FDA, the mechanism by which
they might be incorporated into the ICH guidelines remains
unclear.[283] Thus, consumer groups, and to a more limited
extent the OTC industry, are effectively bound by regulations in
which they have no say.[284]

V. RECOMMENDATIONS

The international standardization of pharmaceutical
regulations has the potential to benefit consumers and producers
worldwide. However, unless certain impediments, detailed above, are
overcome, the benefits of standardization may never be fully
realized. Specifically, the various tools of standardization must
be integrated into a cohesive system, input must be solicited from
a broader spectrum of interested parties, and mechanisms for
enforceability must be established.

Although mutual recognition and harmonization can
be seen as complements, rather than as mutually exclusive,
countries must be careful that these instruments do not work at
cross purposes. Mutual recognition allows approval for sale of a
product made to a harmonized set of specifications solely upon
certification in the exporting country. Mutual recognition alone
though, fails to provide one-step approval for multiple markets
without harmonization or equivalence determinations. [285] Due to this complementarity, even members of the
ICH have continued to pursue MRAs. For example, Japan and the EU
concluded an MRA effective January 1, 2002, which requires them to
recognize mutual safety and reliability certifications of
manufactured goods in the pharmaceutical, telecommunications,
chemicals, and household electrical appliance industries.
Negotiations over this MRA were ongoing since the mid-1990s, the
same period in which the ICH was being implemented.[286]

Despite their complementarity, MRAs can undermine
harmonization. For example, critics of the FDA have accused it of
using MRAs to extend its regulatory hegemony over the markets of
other countries. If this is indeed the case, and the FDA is using
MRAs in part to increase its worldwide power, such behavior will
serve to undermine the efforts of the ICH, which are predicated on
a group of equals working together. To avoid such a situation, it
is important to ensure that MRAs, MOUs, and the ICH be coordinated
in a cohesive system, perhaps under the larger rubric of the ICH
structure.

Another way in which international standardization
can be facilitated is through the broader solicitation of input on
both the domestic and international level. As detailed above,
complaints about the lack of opportunity to impact the
standardization effort have been levied against domestic
participation in standardization as well as against the
international procedures.[287] Consumers and countries outside the ICH system
feel that decisions are being made that affect them without
consideration of their input on the issues.

Lack of input by affected groups will hamper the
public acceptance necessary for the international standardization
process to forge ahead. Domestically, although the FDA can force
regulations on the public to some extent, opponents are not without
weapons. Legal challenges and the manipulation of public opinion
can be affective tools of slowing down implementation of the fruits
of the ICH. By allowing more input of affected groups into the
process, the FDA would build public confidence that safety
standards were being maintained and would serve to deter legal
challenges to the U.S. adoption of ICH guidelines.[288] On an international level, cultural differences
that would hamper the applicability and acceptance of international
standards could be dealt with by soliciting opinions of diverse
countries in the process of creating the standards.

The creation of enforcement mechanisms is a third
major way by which international standardization can be
facilitated. Development and implementation of MOUs, MRAs, and ICH
guidances are slow. Currently, all standardization activity is on a
voluntary basis, and the resulting agreements are non-binding.
Going forward, it will be important for standardization activities
to be encapsulated in a multilateral treaty with binding force.
There should be a dispute resolution mechanism too, to address
issues that arise. The “political commitments”
currently in place need to be given the force of law. A possible
model for an enforcement system would be that of Codex, which
coopts the WTO dispute settlement process.

VI. CONCLUSION

As detailed above, efforts at standardization are
intended to benefit consumers and pharmaceutical producers.
Elimination of duplicative requirements is intended to allow
consumers faster access to new treatments at lower cost while still
ensuring product safety. Producers will be able to cut costs by
reductions in the costs of compliance with multiple regulatory
structures and increase profits by reducing time to market. These
effects are mutually enforcing in many ways; if the cost of
producing drugs is decreased with the reduction of regulatory
requirements, producers can charge less for medicines or allocate
some of the money saved to research and development.

Globalization is happening. Standardization of
pharmaceutical regulations is progressing under the status quo of
MRAs, MOUs, and the ICH. However, the pace of standardization is
relatively slow. MRAs and MOUs are piecemeal tools that bring about
incremental change. While the ICH is more programmatic and
encompasses the three major pharmaceutical producing countries, it
provides a cumbersome, slow-paced process, that produces standards
that are ultimately unenforceable.

To increase the pace of standardization, the MRA
and MOU models need to be incorporated into the ICH and the ICH
needs to be made binding on the parties. Furthermore, increased
participation by non-member nations and consumer groups will
facilitate acceptance of the results of the standardization
process. The way in which Codex standards are given teeth through
the WTO is a possible example of a way to make ICH guidances
binding on member states. Adopting these recommendations will allow
the international community to reap more rapidly the full benefits
of international standardization of pharmaceutical regulations.

THE NEED FOR COMPREHENSIVENESS AND INCREASED
ENFORCEABILITY IN THE STANDARDIZATION OF INTERNATIONAL
PHARMACEUTICAL REGULATIONS

Ellen Hochberg

Food and Drug Law

April 4, 2002

[1] The word more commonly used to include all the
mechanisms to be discussed, “harmonization,” has
different meanings for different people in the pharmaceutical
arena. For example, some people use “harmonization”
interchangeably with “mutual recognition agreements,” a
mechanism which I will discuss separately. See Barbara
Indech, The International Harmonization of Human Tissue
Regulation: Regulatory Control over Human Tissue Use and Tissue
Banking in Select Countries and the Current State of International
Harmonization Efforts, 55Food & Drug L.J. 343, 366
(2000). Others use “harmonization” to refer to all
mechanisms of aligning country regulatory practices, while still
others use “harmonization” as a distinct mechanism
alignment. I use the word “standardization” to include
all the mechanisms to be discussed to avoid the confusion that may
result from the use of a term with no standardized definition.

[2]See Tufts Center for the Study of Drug
Development,Tufts Center for the Study of Drug
Development

Pegs Cost of a New Prescription Medicine at $802
Million , News Release (November 30, 2001), at www.
tufts.edu/med/csdd/images/NewsRelease113001pm.pdf, visited on March
10, 2002. This study updates one done ten years ago, in which costs
of bringing a drug to market averaged $231 million in 1987 dollars.
Had inflation been the only cause of increased cost, the amount to
bring a drug to market would be $318 million in 2000 dollars.
SeeId.

[4]See id. The Tufts Center study found that
while costs increased in inflation-adjusted terms for all R&D
phases, there were particularly dramatic increases for the clinical
period. The inflation-adjusted annual growth rate for capitalized
clinical costs (11.8%) was more than five times greater than that
for pre-clinical R&D. See id.

[5]See Federal Food, Drug, and Cosmetic Act, 21
U.S.C. §301 et seq (1999). To be marketed in the United
States, a drug must be approved by the FDA after review of a New
Drug Application (NDA). The NDA must include the results of at
least two controlled clinical trials. In the NDA, proposed labeling
must be supported by data showing the safety of the recommended
uses and any potential side effects or contraindictions associated
with usage of the drug. Post-marketing reports of any adverse
reactions must be submitted to the FDA periodically, and
manufacturing plants are subject to FDA inspection. See
Thomas M. Moore and Siobhan A. Cullen. Impact of Global
Pharmaceutical Regulations on U.S. Products Liability Exposure
, 66Def. Couns. J. 101, 102-103 (1999).

[6] However, developing countries usually accept
approvals from the United States and other developed countries.

[7]See Michelle D. Miller, The
Informed-Consent Policy of the International Conference on
Harmonization of Technical Requirements for Registration of
Pharmaceuticals for human Use: Knowledge is the Best Medicine ,
30 Cornell Int'l L.J. 203, 205 (1997). However, the FDA now
does approve some drugs based on foreign trials. See Eric M.
Katz, Europe's Centralized New Drug Procedures: Is the United
States Prepared to Keep Pace? 48 Food & Drug L.J.
577, 581 (1993). 21 CFR §312.120(a) states that the FDA
accepts foreign clinical studies not conducted under an IND as long
as they are “well designed, well conducted, performed by
qualified investigators, and conducted in accordance with ethical
principles acceptable to the world community.” 21 CFR
§312.120. §312.120(b)-(c) set out the information to be
submitted to the FDA in order to rely on foreign studies to support
an application. However, if marketing approval of a new drug is to
be based solely on foreign clinical data, §314.106 states that
approval may be granted only if “(1) The foreign data are
applicable to the U.S. population and U.S. medical practice; (2)
the studies have been performed by clinical investigators of
recognized competence; and (3) the data may be considered valid
without the need for an on-site inspection by FDA or, if FDA
considers such an inspection to be necessary, FDA is able to
validate the data through an on-site inspection or other
appropriate means.” Id.

[15]See id. at 2014. One estimate suggests that
8,000 to 15,000 patients died from gastric ulcers while the FDA was
considering the NDA for misoprostol, a drug used to treat that
condition.
Also, in the five years in which the drug nitrazepam was approved
in Britain but not in the Unites States, pharmacologists argue that
millions of lives could’ve been saved. See id.

[25]See Dominguez-Urban, supra note 16,
at 247. For example, when antibiotics in developing countries are
used in inadequate dosages and for inadequate periods,
drug-resistant strains of bacteria are created, which then spread
across national boundaries. See id. at 249.

[41] 21 C.F.R. § 130.6 (a), Review of Codex
Alimentarius food standards, states that “[a]ll food
standards adopted by the Codex Alimentarius Commission will be
reviewed by the Food and Drug Administration and will be accepted
without change, accepted with change, or not accepted.”

[42]See Eldred and Coffield, supra note
35, at 32. The US Codex generated a Strategic Plan asserting that:
1) The United States should support the efforts of the Codex and
other international organizations to improve the scientific basis
for Codex standards, so that these standards may be based
consistently on sound scientific analysis and evidence; 2) the
United States should support efforts to improve Codex management
processes in order to enhance the Commission's credibility with
national regulatory authorities and consumers; 3) the United States
should step up its commitment to systematically and routinely
evaluate Codex standards for acceptance as the basis for U.S.
standards; 4) the U.S. Codex should encourage and enable all
significantly interested nongovernmental bodies to participate
actively in Codex activities; and 5) the U.S. Codex should be
allocated sufficient resources to effectively carry out its
mission. See Office of the U.S. Coordinator for Codex
Alimentarius, U.S. Codex Strategic Plan (Draft Plan) ,
ii-iii (1995).

[73]See id. See http://www.wto.org/english/docs_e/legal_e/final_e.htm
(visited March 17, 2002) for the full text of the Agreement on
Technical Barriers to Trade and
http://www.mac.doc.gov/nafta/ch09.htm (visited March 17, 2002) for
the full text of Chapter Nine of NAFTA on Standards-Related
Measures.

[75]See Senie and Helne, supra note 68,
at 227-228. A Committee on Standards Related Measures (CRSM),
composed of government representatives from each party, implements
the requirements of the standards chapter under the NAFTA
agreement. This Committee on Standards includes four subcommittees,
each dealing with the
harmonization of standards in either the transportation,
telecommunications, automobiles, or textile and clothing labeling
sectors. The TBT Agreement establishes a Technical Barriers to
Trade Committee, consisting of representatives from each WTO
member, so as to give members the chance to communicate on matters
relating to the TBT. The TBT Committee recently finished its first
triennial assessment of the Agreement’s operation. See
id.

[77] For example, the United States would agree to
accept another country’s verification that goods made in that
country comply with United States’ law. While the substantive
law to be applied is unchanged, the other country’s agent is
deputized to apply the law. See Merrill, supra note
45, at 135-136.

[78] In other words, the standards of the two countries
are deemed functionally equivalent. See id.

[95] Although, such determinations by the U.S. raise the
question as to why the U.S. requires more extensive regulation if
it determines that less stringent regulations are
“equivalent” in producing decisions about
pharmaceutical safety.

[106] See Senie and Helne, supra note 68, at
229. The text of the MRA can be found at
http://www.fda.gov/oia/ecmutual.htm, visited on April 1, 2002. The
EU also completed MRAs with Canada, New Zealand, and Australia at
around the same time. See Senie and Helne, supra note 68, at
229.

[108] See Senie and Helne, supra note 68, at
229. In the U.S., consultations with Congress and industry groups,
as well as an FDA-mandated notice and comment period are required
for adoption of an MRA. See id.

[110]See John R. Schmertz and Mike Meier,
European Union, Canada, and U.S. Conclude Mutual Recognition
Agreements to Facilitate the Sale of Certain Products in Each
Other’s Markets , Int’l Law Update , 87
(1997).

[115]See id. at 728-729. Under this
procedure, the FDA still retains the possibility of rejecting such
reports, although such power is intended to be used only rarely,
and thus the ultimate say on compliance. See id.

[126] Because MOUs can take a variety of forms, it
is often unclear what the real differences are between MOUs and
MRAs, and this confusion is not resolved in the literature on
standardization agreements. For example, no article spelled out the
different areas in which an MRA would be used over an MOU and visa
versa.

[140] An example of such an MOU is an agreement
signed by FDA and its counterparts in Canada and Mexico (Memorandum
of Cooperation in FDA International Cooperative Agreements Manual).
See Horton, supra note 82, at 719.

[147] The goal is provide the greatest benefit in
relation to the resources required to administer a program. For
example, the costs of developing, implementing, and monitoring an
agreement should be measured against the alternative, like the
costs of higher sampling levels to obtain the same degree of
confidence in rates of compliance in the absence of an agreement.
See id. at 31486.

[157]See Walser, supra note 47, at
1650-1651. Controlled substances or highly addictive products must
still be approved by the Russian Federation's State Committee on
Controlled Substances. Additionally vaccines are subject to extra
regulations. See id.

[170]See Booth, supra note 8, at 203.
As of 1994, these countries accounted for 75 percent of the
world’s pharmaceutical market and produce ninety percent of
all pharmaceutical research. See Kanusky, supra note
19, at 767 (1994).

[176] In the Statement by the ICH Steering Committee
“[t]he Parties cosponsoring th[e] Conference, represented at
the 2nd Steering Committee Meeting in Tokyo, 23-24 October 1990
re-affirmed their commitment to increased international
harmonisation, aimed at ensuring that good quality, safe and
effective medicines are developed and registered in the most
efficient and cost-effective manner. These activities are pursued
in the interest of the consumer and public health, to prevent
unnecessary duplication of clinical trials in humans and to
minimise the use of animal testing without compromising the
regulatory obligations of safety and effectiveness.”
Statement By the ICH Steering Committee Tokyo, October 1990
, athttp://www.ifpma.org/ich8.html
, visited March 10, 2002.

[216]See International Agreements: EC, U.S. and
Japan Sign Commitment to Standardize Pharmaceutical Tests, 8
Int’l Trade Reporter 1702, 1702 (1991). However, for
such commitments to come to fruition, each country must integrate
the ICH guidelines into domestic law.

[217]See Caroline Nutley, supra note
29, at 2-3. See id. for a list of guidelines under
consideration in each category, as well as the texts and current
stage of consideration of such guidelines.

[236] Criticism of particular tools of
standardization focus on the ICH and MRAs. MOUs, perhaps because
they are more limited in scope, have not been specifically
denigrated as a tool of standardization in the literature.

[250]See Booth, supra note 8, at 212.
Registration fees for the third conference in 1995 were
approximately $1330. See id. at 212 n.68.

[251]See id. at 212. Registration materials
for the third ICH conference specifically recognized “the
importance of ensuring that the process of harmonisation is carried out in an open and
transparent manner and that ICH discussions are presented in
an open forum." Third ICH, Preliminary Program and
Registration Forms (1995), cited in Booth, supra note
8, at 212.

[265]See Eakin, supra note 58, at
222. Various motives have been posited for the increasing
cooperation by the FDA in international standardization. Factors
such as agency resource constraints, increased international trade
of drug products, and political pressure exerted through mandatory
trade agreements have been cited as driving FDA action. See
id. Additionally, FDA actions have been attributed to
FDA’s fear of losing its dominant position internationally in
pharmaceutical regulation. Given its position as the regulator of
the largest homogeneously regulated pharmaceutical industry and
market, the FDA’s regulations have served as the basis for
development and testing plans by producers. However, with the
emergence of the even larger EU market regulated by the EMEA, there
is the danger of EMEA regulations becoming the standard on which
testing programs are based. If this were to occur, the pace of
approval of drugs for the U.S. market would be further slowed in
the absence of standardization, as drugs developed to accord with
EMEA guidelines would be subjected to additional testing before
entering the U.S. market. The FDA might be engaging in
standardization as a means to head off this increase in an
already-criticized lengthy time to market. See Booth,
supra note 8, at 207.

[266]See Suydam and Kubic, supra note
264, at 131. The other objectives of the FDA are: 1) a timely
review of regulated products, 2) the protection of public health by
ensuring that food and cosmetics are safe and properly labeled, 3)
ensuring that human and veterinary drugs are safe and effective, 4)
providing a reasonable assurance of the safety and effectiveness of
medical devices, and 5) public protection from electronic product
radiation. See id.

[267]See Department of Health and Human
Services, Food and Drug Administration International
Harmonization; Policy on Standards, 60 FR 53078-01
(1995). This document covers all standardization efforts, including
those for food, the Codex Alimentarius Commission and the Food
Chemicals Codex, and the ICH.See also Booth,
supra note 8, at 208-209. The Policy states that the
FDA’s participation in the ICH is covered by Title 21 of the
Code of Federal Regulations, section 10.95, which provides
mandatory standards for FDA participation in outside
standards-setting activities. See id. at 211.

[268] Booth, supra note 8, at 209. However,
the Draft Statement does not define criteria for deciding when
standards are ineffective or inappropriate. See id.

[273] That such testimony should be necessary is
surprising given Congress’ commitment to standardization as
manifested in acts such as FDAMA. See text accompanying notes
260-264 for further examples of Congress’ professed
commitment to standardization. However, the House Commerce
Committee, which oversees the FDA, has questioned the advisability
of MRAs due to worries that MRAs will allow into the U.S. drugs
approved under less exacting regulations than those imposed by the
FDA. The Committee’s concerns are at least in part a
reflection of their constituents’ zero tolerance for risk.
Congress also does not want to be perceived as putting trade
revenues above public health. See also Eakin, supra
note 58, at 229.